Reader’s Question:
I was told recently that having a lien on my car will raise my insurance premiums in Dallas Texas. Is this true?
Billy
Dallas, TX
If a vehicle is purchased or paid for in full or if it is financed could be a rating factor that is applied to insurance provider’s rating system.
The rating factors that insurance companies normally consider include your the kind of car you operate, your age, your claims history, your driving history and in some states your credit record.
Many insurance carriers in Dallas Texas thus ask if you have a lien holder on the vehicle or have paid for it in full due to how they have filed their car insurance rates and/or to be sure that if the vehicle is financed you carry Physical Damage since it is most likely required by your lien holder. Typically it is not a rating factor that will raise your car insurance rates but just information an insurance company needs to properly quote you insurance rates on the type of coverage you will need on the car.
Comprehensive and collision are the type of physical damage coverage that is usually required if your car is leased or financed. Lien holders require these coverages normally on a car to protect their interest or collateral, the car.
Tags: auto insurance, car insurance rate